Abstract Background Azithromycin and trimethoprim-sulfamethoxazole (SXT) are widely used to treat undifferentiated febrile illness (UFI). We hypothesized that azithromycin is superior to SXT for UFI treatment, but the drugs are noninferior to each other for culture-confirmed enteric fever treatment. Methods We conducted a double-blind, randomized, placebo-controlled trial of azithromycin (20 mg/kg/day) or SXT (trimethoprim 10 mg/kg/day plus sulfamethoxazole 50 mg/kg/day) orally for 7 days for UFI treatment in Nepal. We enrolled patients >2 years and <65 years of age presenting to 2 Kathmandu hospitals with temperature ≥38.0°C for ≥4 days without localizing signs. The primary endpoint was fever clearance time (FCT); secondary endpoints were treatment failure and adverse events. Results From June 2016 to May 2019, we randomized 326 participants (163 in each arm); 87 (26.7%) had blood culture–confirmed enteric fever. In all participants, the median FCT was 2.7 days (95% confidence interval [CI], 2.6–3.3 days) in the SXT arm and 2.1 days (95% CI, 1.6–3.2 days) in the azithromycin arm (hazard ratio [HR], 1.25 [95% CI, .99–1.58]; P = .059). The HR of treatment failures by 28 days between azithromycin and SXT was 0.62 (95% CI, .37–1.05; P = .073). Planned subgroup analysis showed that azithromycin resulted in faster FCT in those with sterile blood cultures and fewer relapses in culture-confirmed enteric fever. Nausea, vomiting, constipation, and headache were more common in the SXT arm. Conclusions Despite similar FCT and treatment failure in the 2 arms, significantly fewer complications and relapses make azithromycin a better choice for empirical treatment of UFI in Nepal. Clinical Trials Registration NCT02773407.